An investment at 5.2% simple interest is made. At the end of one year, the total value of the investment is $2419.6. How much was originally invested?

Question

Please solve this algebraic word problem

Answer 1

*Note: Use following Interest Formula  

 

I = Prt; I = interest made, P = original investment; r = interest rate = .052, t= time in years =1

 

I = P(.052)(1) =.052P

 

*Note: Original investment is the difference between the interest made from total value of investment

which equates to

 

I = 2419.6-P

*Note: Substitue I in interest formula and Solve for P

 

I = .052P = 2419.6-P

 

1.052P = 2419.6

 

P = $2300